Emergency Backup Generators Should Remain Available for Demand Response

EnerNOC has announced that it fully supports the U.S. EPA’s proposed rule regarding the continued use of emergency backup generators in demand response programs. The rule would allow properly permitted emergency backup generators to run for up to 100 hours annually to ensure the lights stay on when grid operators determine that electricity demand is going to overwhelm supply and declare an emergency event.

The proposed rule (Docket ID No. EPA-HQ-OAR-2008-0708) is open for public comment through August 9, 2012. Some independent power plant owners and operators are advocating for EPA to take this last-line-of-defense resource away from grid operators’ control, which would reduce grid reliability and increase consumer costs.

Grid operators use emergency backup generators only when they determine that an emergency is imminent – they are not used during periods of peak demand or high prices alone. In fact, emergency demand response events are rarely called. Over the past decade, there have been less than 35 emergency demand response events called by PJM Interconnection, New York ISO, ISO New England, and the Electric Reliability Council of Texas combined. Since the eastern blackout of 2003, for example, emergency backup generators have been dispatched only once in all of New England, and that was for 3.75 hours in 2006.

Backup generation during emergency situations helps prevent grid failures that jeopardize public health and safety. If grid failure occurs, it can take days to restore conditions to normal operating levels. It is far better to have a subset of emergency backup generators available to grid operators for dispatch for short periods of time to prevent blackouts from occurring than it is to allow the grid to fail and have every backup generator in the region run until the grid is restored.

Air regulators in states with emergency demand response programs widely recognize the value of these programs, allowing grid operators to dispatch emergency backup generators as a last line of defense to protect grid reliability.

Businesses and institutions that participate in emergency demand response programs are compensated for their availability to reduce electricity demand from the grid, whether or not they are actually called upon to do so, helping to improve their bottom lines and create jobs.

Emergency demand response has a net positive impact on the environment. The proposed rule applies to existing emergency backup generators only. As program participants are not building anything new, there is no pollution from construction, no land or water use issues, and no new transmission needed. In addition, because backup generators need periodic testing, in many cases operating these assets for emergency demand response events does not increase runtime or emissions as testing during that period is no longer necessary.

Demand response saves billions of dollars for consumers every year. The PJM independent market monitor recently credited demand response and energy efficiency programs for having saved ratepayers in the Mid-Atlantic region $11.8 billion in one year, which equates to approximately $200 in savings per person. The majority of these savings were from emergency demand response.

Entities that have filed comments in support of EPA’s proposed emergency backup generator rule include: the American Public Power Association; Edison Electric Institute; the National Rural Electric Cooperative Association; grid operators such as the Midwest ISO; and public and municipal utilities such as Progress Energy, Duke Energy, Florida Power & Light, and Southern Company.

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